Nissan Pursues Aggressive Growth Strategy in China Amid Global Recovery Efforts

Nissan Seeks Rebound in China Amid Global Challenges

Nissan Motor Co. is pinning its hopes on China to help reverse its fortunes, which have been battered by headwinds in the US and Japan. The Japanese automaker is pressing ahead with a growth plan for China, aiming to reach annual sales of 1 million cars by the end of the decade. Furthermore, the company plans to export hundreds of thousands of vehicles from Chinese factories to other parts of the world.

Nissan has a long history in China, dating back to 2003 when it formed a partnership with Dongfeng Motor Group Co. The company's early success in the country was largely due to its partnership with Dongfeng and the popularity of the Sylphy sedan. However, Nissan has seen its sales volume drop by nearly half in recent years, largely due to the rise of local electric-vehicle (EV) manufacturers such as BYD Co. and Geely Automobile Holdings Ltd.

Despite this, Nissan is optimistic about its chances in China, citing its two-decade-long experience and relationships in the country. The company has developed a new lineup of vehicles, with each model taking only 24 months to develop, compared to the 4-5 years typically required by legacy brands. This aggressive development pace has allowed Nissan to keep pace with the rapidly changing Chinese market.

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Nissan's China sales grew for the first time in seven years during the latest fiscal year, with a 4.5% increase in the second half compared to the previous year. The company plans to introduce five more models in China within the next year, completing its lineup of 10 brand new cars, including all-electric sedans and plug-in hybrid trucks.

The company's growth plan for China also includes exporting vehicles made in the country to other markets. Nissan aims to export 100,000 units initially, with the goal of reaching 300,000 units eventually. The N7 electric sedan will be shipped to Latin America and Southeast Asia, while the Frontier Pro utility vehicle will be sold in those two markets, as well as in the Middle East. The NX8, Nissan's newest model, will also be exported in the near future, although executives declined to comment on the specific markets.

Note: The above table compares the sales figures of Nissan, BYD, and Geely in the US, China, and globally for Q1 2022. While Nissan has struggled in the US and Japan, the company is optimistic about its chances in China, where it has a long history and established relationships.

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Nissan's growth plan for China is part of a broader effort to revamp its aging product lineup and streamline its operations. The company plans to reduce the number of models from 56 to 45 and focus on three main "families" of vehicles built on shared platforms. This strategy is expected to help Nissan improve its efficiency and competitiveness in the Chinese market.

"We've learned our lesson about how to survive in China," said Isao Sekiguchi, a Nissan executive and managing director of Dongfeng Nissan Passenger Vehicle Company.